Table Of Content

Rate Setting Process TNB Debt Service Schedule Debt service payments increase for next 12 years • The new Tacoma $90 Narrows Bridge was $80 funded through issuing bonds $70 • Debt service payment $60 schedule was set rs when project was a $50 oll originally financed d f o s $40 n o • No option to refinance Milli $30 • Payments and toll $20 rates assumed to increase over time Deferred Sales Tax Repayment $10 Debt Service Payment • Repayment for $0 deferred sales taxes FY07 FY09 FY11 FY13 FY15 FY17 FY19 FY21 FY23 FY25 FY27 FY29 to begin in December 2012 for ten years 11 Tacoma Narrows Bridge: Revenue vs Expenses (FY 2008- 2011) *FY 2012 PROJECTED $60,000,000 $54,831,190 $50,311,0 $46,086,41 $50,000,000 $45,584,482 $46,682,925 $46,026,509 $46,236,000 $38,058,078 $40,000,000 $31,188,744 $30,074,589 $44,955,420 $40,443,000 $30,000,000 $34,902,925 $26,925,418 $14,688,752 $20,000,000 $10,000,000 $15,385,837 $11,132,660 $11,183,690 $9,875,770 $9,888,000 $- Revenue Expenses Revenue Expenses Revenue Expenses Revenue Expenses Revenue Expenses 2008 2009 2010 2011 Projected 2012 O&M DEBT SERVICE Source: Washington State Transportation Commission 12 Effect of Economy on Traffic Forecasts Effect of Economy on Traffic Forecasts Annual Round Trip Traffic on TNB (in millions) Annual Round Trip Traffic on TNB (in millions) 20 September 2009 Forecast 18 16 14 12 November 2011 Forecast 10 March 2011 Forecast 8 6 4 2 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Note: The March 2011 and June 2011 forecasts were the same. 13 What Rates Are Required? • Statute declares that rates must be “sufficient” to meet debt service obligations. • Transportation Commission policy requires that the sufficient fund balance in the Tacoma Narrows Bridge account each year be 12.5% of annual debt service and expenditures. • Prior forecasts suggested that a toll rate increase might not be needed before July 1, 2012. • Rate increase was deferred in 2011, reflecting a conscious decision to lower fund balance to the 12.5% sufficient balance policy level. 14 Why a Rate Increase is Needed TTTaaacccoooTmmmaaacao NNNmaaaarrrrrr oNoowwwarsssr oTTToowollllsll BBBTrorriiildddl gggBeeer iAAAdccgcccceooo Auuucnnncttto (((u555n1111t11 )())511) Fund balance will go negative at current toll rates EEEnnndddiiinnEngngg dFFFiuuunnnngddd F BBuBanaalldlaaa nnnBcccaeeela vvvnsssc 11e122 2v...s555 %%1%2 SSS.5uuu%ffffffi iicScciiuieeefnnnfitttc MMiMeniiinnnti iimMmmuuiunmmmim BBBuaaamlllaaa nnnBcccaeeelance (((bbbaaassseeeddd(b oooannns e DDDdrrr aaaofffnttt AADAnnnrannnfuuuta aaAlll n FFFniiinnnuaaaannnl cccFiiiiaaanlll a PPPnlllacaaninna lddd Paaaltttaeeenddd d NNNaoootevvvedeem mmNbbobeeverrer 1m11555b,,, e 222r000 11115111,))) 2011) $$$222000,,,000000000$20,000 AAAccttcuutaualalAl ctual FFFooorrereecccaaassFsttotrecast $$$111555,,,000000000$15,000 Decision in 2010 to reduce fund balance to 12.5% ))) ) sss s$$$111000,,,000000000$10,000 ddd d nnn n aaa a sss s uuu u ooo o hhh h$$$555,,,000000000 $5,000 ttt t n n n n s is is i s i rrr r aaa a ollolloll oll $$$000 $0 ddd d ((( ( ((($$$555,,,000000000)))($5,000) Fund balance needed to achieve Commission ((($$$111000,,,000000000($)))10,000) 12.5% minimum balance At current toll rates fund balance will go negative ((($$$111555,,,000000000($)))15,000) ((($$$222000,,,000000000($)))20,000) FFFYYY 222000000888FY 2008 FFFYYY 222000000999FY 2009 FFFYYY 222000111000FY 2010 FFFYYY 222000111111FY 2011 FFFYYY 222000111222FY 2012 FFFYYY 2 22000111333FY 2013 EEEnnndddiiinnnggg UUUEnnnnrrrdeeeissnseeegrrr Uvvveeendddr e FFFsuuuennnrddvde BBBdaaa Flllaaaunnnncccdeee Balance 999,,,444111888 9,418 111666,,,222999000 16,290 111666,,,444111333 16,413 888,,,111222444 8,124 333,,,555888111 3,581 (((111666,,,000777666)))(16,076) 111222...555%%% SSSuu1uff2ffff.iii5cccii%ieeenn nStttu MMMffiiiicnnniiieimmmnuutu mmmM iBBBnaaaimlllaaanunnmccceee Balance666,,,666666888 6,668 444,,,999888555 4,985 555,,,888444999 5,849 666,,,888666000 6,860 666,,,222999111 6,291 888,,,333555888 8,358 15 Proposed Rate-setting Process 16 Next Steps • Upcoming Citizen Advisory Committee Meetings: – January 11: Evaluate scenarios – February 8: Presentation of scenario results and Q&A (preceded by WSDOT open house) – February 22: Answers to remaining questions, deliberation on recommendation – March 8: Hold meeting date if needed – March 20: Present recommendations to the Commission. • Baseline Toll Rate Scenarios currently in evaluation 17